Japanese Prime Minister Abe has announced that Japan will seek entry into negotiations under the Trans Pacific Partnership (TPP). The existing 11 TPP partners, including the United States, must approve Japan’s application before the country can join the trade talks.
“Japan is a vital export market for U.S. rice,” said Mark Denman, USA Rice Chairman and a Texas rice miller. “As the United States and other TPP partners consider Japan’s application, it must be clear that all products, including rice, be on the negotiating table as a condition for Japan’s entry into the trade negotiations.”
Japan ranks consistently as the number two market for U.S. rice by value and $242 million of U.S. rice was shipped to Japan in 2012.
“The U.S. rice industry has long sought better market access in Japan,” noted Michael Rue, a California rice producer and vice chairman of USA Rice’s International Trade Policy Committee. “The TPP negotiations offer the best opportunity since the Uruguay Round concluded nearly 20 years ago to achieve a meaningful improvement in the quantity and quality of U.S. rice access.”
“We appreciate and understand the political sensitivity of rice in Japan, which is reflected in the current restrictions on access for imported rice,” continued Rue. “Japan is a leader in the global economy, and commercially meaningful improvements in access for U.S. rice must be a result of Japan’s desire to join in a TPP agreement. Negotiations will likely be difficult, and the rice industry stands ready to support U.S. negotiators in the weeks and months ahead.”
Steady U.S. rice exports to Japan began in the mid-1990s as a result of the Uruguay Round’s Agreement on Agriculture and have averaged almost 330,000 metric tons annually, representing about nine percent of total U.S. rice exports.
Under Japan’s obligations to members of the World Trade Organization (WTO), Japan imports 682,200 MT of rice (milled equivalent basis) annually during Japan’s April/March fiscal year. Imports above this level face a prohibitive tariff of approximately $3,400 per ton at today’s exchange rate. The government of Japan is the sole importer of rice within the quota for WTO members.
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